Procurement Supply Chain in Ghana

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Presentation by Charles Allotey of Health Access Network, and CSO representative on 16th April 2009 during the MeTA Ghana CSO & Media Orientation workshop …

Presentation by Charles Allotey of Health Access Network, and CSO representative on 16th April 2009 during the MeTA Ghana CSO & Media Orientation workshop

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  • 1. Procurement Supply Chain in Ghana Charles Allotey Health Access Network 16 th April 2009 MeTA Ghana: CSO & Media Orientation
  • 2. Introduction
    • Problems of Medicines and their prices
    • Med. Supply chain and issues affecting prices
    • Identify points of transparency
    • What CSO and Media can do
  • 3. Problems of medicines and their prices
    • Medicines have variable prices, often high and unrelated to countries’ income levels;
    • Medicines are often unaffordable for individuals and are a major burden on government budgets;
    • The availability of medicines is often poor, especially in public sector facilities;
    • Trade agreements may severely affect the price and availability of medicines;
    • Many developing countries have no medicine pricing policies or regulation;
    • Bu t: little is known about the actual prices people pay and how these prices are set, from the manufacturers’ selling price to the patient price.
    • Prices of medicines are well above their production costs, and that there is great scope for reductions to improve access. .
  • 4. Source Of Funds Procurement Agent/Body Point of first warehousing Point of 2 nd warehousing Point of 3th warehousing GOVERNMENT WB GLOBAL FUND USAID CENTRAL MEDICAL STORE Medicines supply systems in GHANA 2007 GAVI ESSENTIAL MEDICINES ARVs MALARIA TB OI ARVs Ped REAGENT Blood safety (+ test HIV) VACCINES CONDOMS Contraceptives MEDICAL SUPPLIES Government Multilateral Donor Bilateral Donor Category of Products color code MOH UNICEF USAID GOVT Of JAPAN UNFPA REGIONAL MEDICAL STORE DISTRICT MEDICAL STORE UN AGENCY Republic of Ghana ITNs D F I D GOVT Of JAPAN FAITH- BASED ORGs POP/ RDF HEALTH FACILITY HEALTH FACILITY FAITH- BASED ORGs FAITH-BASED ORGs DESIGNATED TREATMENT CENTRE UNFPA WHO GDF
  • 5. International manufacturers Local manufacturers Importers CMS Wholesalers Accra NGO distribution RMS Private hospitals and clinics Public hospitals and clinics Mission hospitals and clinics Wholesalers Regions Private pharmacies Licensed chemical shops
  • 6. Supply chain: Price component stages
      • Stage 1: Manufacturer’s selling
      • price or cost, insurance and freight
      • Stage 2: Landed price (importation)
      • Stage 3: Wholesale selling price
      • Stage 4: Retail selling price
      • Stage 5: Dispensed medicine price
  • 7. Factors affecting Medicine Prices along the supply chain R&D and clinical trials Patent Taxes and Tariffs Registration Pricing policy Drug supply Management Manufacturing Drug discovery costs
  • 8. Supply Chain - Impact on Patient Price: Patient price increases by multiple of ex-factory price 17-24 Feb 2008 MeTA CSO Capacity Building Add-on Imported Locally produced Insurance and freight 10-17% NDA 2% Clearance & finance/banking charges 2% Importer (higher for single source products) 20-70% Wholesaler 2-30% 15% Retailer – typically Pharmacy 125% 105% Drug Shop 85% 115% Clinic 250% 145% TOTAL Pharmacy 150 - 250% 120% Drug Shop 120 - 200% 130% Clinic 280 - 375% 160%
  • 9. Supply Chain - Impact on Patient Price
    • Excessive mark-ups
    • Corruption
    • Poor forecasting
    • Short term procurement
    • Lack of capacity
    • Leakage/diversion
    • Poor quality/counterfeit drugs
    Pharma Procurement Wholesaler Distributor Retail / health unit Patient
  • 10. Markup composition ciprofloxacin
  • 11.  
  • 12. What can MeTA, CSO and Media do?
    • Disclose information at each point along the supply chain
    • Identify discrepancies
    • Assess prices and make recommendations for future action
    • Use information put into the public domain for advocacy to increase AEM
    • Transparency can help…
    • Scrutiny of process
    • Identify real problems
    • Empower patients / consumers
    • Reduce Medicine prices and Improve AEM
    Pharma Procurement Wholesaler Distributor Retail / health unit Patient
  • 13. Thank you!
    • Charles Allotey
    • Email: [email_address]
    • Mr. Samuel Boateng
    16 th April 2009 MeTA Ghana- CSO & Media Orientation
  • 14.